THIS BLOG RATES THE S&P 500 BUY/SELL/OR HOLD EACH DAY WITH 2-GOALS FOR LONG TERM INVESTMENTS: (1) PRESERVE CAPITAL (2) BEAT THE S&P 500.
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Friday, March 4, 2016

PAYROLLS (CNBC)“Hiring was stronger than expected in February, signaling
the economy is far from recession, but the fact there was no wage growth should
keep the Fed
from raising rates until at least midyear. There were 242,000 nonfarm payrolls
added in February…” Story at…http://www.cnbc.com/2016/03/04/jobs-report-is-strong-but-fed-can-wait-on-hike.htmlTRADE DEFICIT RISES – EXPORTS PLUNGE (Global Economic
Trend Analysis)“Exports
unexpectedly declined a sizable 2.1 percent in February. Imports fell 1.3
percent. As a result, the trade deficit widened to -45.7 billion….US exports
shrinking is consistent with a rapidly cooling global economy…Those who think
the US will decouple from the global economy are mistaken.” – Mike
Shedlock.Story at…http://mishtalk.com/2016/03/04/trade-deficit-rises-as-exports-unexpectedly-plunge-2-1/#more-35712AVERAGE WORKWEEK FALLS“The average workweek declined 0.2 to 34.4 hours
(Briefing.com consensus 34.6).” From…https://www.briefing.com/Investor/Calendars/Economic/Releases/employ.htmMy cmt: This clouds today’s job report somewhat. Most
pundits focused on the jobs created today, but on an hourly basis, nearly
1-million jobs were lost last month. Why? - Because the average hours worked
dropped 0.2 hours per worker. {318 million population x 59.8% (%-employed) x
0.2 hours (decline in avg. workweek) / 40hr/week = 0.95 or about 1 million.} Ed Lazear, Professor of Economics at the
Stanford Business School, made this clear during his appearance on CNBC today.IS THE BEAR MARKET OVER (Real Investment Advice)“…being overly bullish at the moment carries more
portfolio risk (loss of
capital if you wrong) than being bearish (missing out on early gains).”
Commentary at…http://realinvestmentadvice.com/weekend-reading-is-the-bear-market-over-already/MARKET REPORT / ANALYSIS- Friday, the S&P 500 was up 0.3% to 2000 at the
close.-VIX was UP about 0.5% to 16.8
as of 4PM.-The yield on the 10-year Treasury rose to 1.88%.The Overbought/Oversold Ratio remained “Overbought” Friday
for the ninth day in a row. RSI was “Overbought” yesterday and is now slightly
below the overbought level. This rise probably won’t last too much longer, but
overbought conditions can remain for extended periods.The S&P 500 is about 1% below the 200-dMA and the
slope of the 200-dMA remains down. All in all, the Index is still in a down
trend.MONEY TREND & SHORT TERM TRADINGThe short-term Money Trend indicator is still suggesting downside ahead.I still am holding short positions in SH and QID. So far,
these trades aren’t working.MARKET INTERNALS (NYSE DATA)(I am getting data from various sites. Some of the
numbers are subject to minor revision so the previous day’s numbers may be
slightly different than reported yesterday.)The 10-day moving average of the percentage of stocks
advancing (NYSE) is 65.2% Friday vs. 63.7% Thursday. (A number above 50% is
usually GOOD news for the markets.) I could only find one higher value in the
last 7-years (18 Jan 2014). Really?This
is one of the most bullish 10-day periods since 1 January 2010? For many
investors optimism is nearly unparalleled.On a longer term, the 150-day moving average of advancing
stocks improved to 50.1%. A value above 50% indicates an up-trend. The
McClellan Oscillator (a Breadth measure) declined slightly but remained solidly
positive. New-highs again outpaced New-lows. The spread (new-highs
minus new-lows) was +72 Friday. (It was +73 Thursday.)The 10-day moving average of the change in
spread improved to +8. In other words, over the last 10-days, on average; the
spread has INCREASED by 8 each day. Market Internals remained positive on the
markets.

Market Internals are a decent trend-following analysis of
current market action, but should not be used alone for short term trading.
They are usually right, but they are often late.They are most useful when they diverge from
the Index.In 2014, using these
internals alone would have made a 9% return vs. 13% for the S&P 500 (in on
Positive, out on Negative – no shorting).Of course, few trend-following systems will do well in an extreme
low-volatility, nearly straight-up year like 2014.NTSMFriday, Price, Volume & VIX were positive. Sentiment was
neutral. The long-term NTSM indicator is BUY. I have not followed the guidance
yet. My guess is that the Index is very close to topping out.We’ll see.MY INVESTED STOCK POSITION:TSP (RETIREMENT ACCOUNT – GOV EMPLOYEES) ALLOCATIONOn 30 Dec I reduced my invested position in my retirement
account to 30% invested in stocks thru an S&P 500 Index fund (“C”-fund in
the TSP) and on 15 Jan I reduced stock allocation to zero in long-term
accounts.The S&P 500 peaked in Mid-May and has not been able
to break higher in the past 9-months. That looks like a top to me. See “Why the
Bull Market May be Dead” in my 14 December blog at…http://navigatethestockmarket.blogspot.com/2015/12/stocks-are-topping-time-to-sell-hussman.html

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About Me

I am an engineer with a lifelong interest in "playing with numbers" so what could be more fun than trying to develop a system that beats the stock market? Well, lots of things, but I decided to do this anyway.
While I am not a finance-professional, or professional investor, I have developed some skills.
I competed in two CNBC Million Dollar Portfolio contests finishing in the top 4% in 2008 (34,320th of 800,000) and the top 0.1% (448th of 500,000) in 2009. More importantly, I managed to sell out of my retirement accounts at or near the top in 2000 and 2007 and bought close enough to the bottom that I didn’t lose too much sleep. (Even Bill Gates lost SOME sleep.)
I hope that my thoughts will help you achieve your investing goals. Please remember that my ideas are free and there may be times when my ideas are worth less than what you paid.